The Project would be developed as per specifications in the concession contract between the Borrower and ANEEL and Project’s key components would be substations at Graca Aranha and Silvânia, and two electricity transmission lines (one high-voltage direct current transmission line between Graça Aranha and Silvânia and one high voltage AC transmission line between Presidente Dutra and Graça Aranha.

The Project will increase power transmission capacity between Northeast and Southeast regions of Brazil and by enabling the grid to absorb more renewable energy, it leads to a more favorable investment climate for renewable energy projects in Northeast Brazil. Addition of high voltage direct current (HVDC) transmission lines are more advantageous compared to existing high voltage AC electricity transmission alternatives and hence lead to avoidance of CO₂ emissions.

The Project will be implemented by the Borrower in accordance with laws and regulations in Brazil. The EPC contracts for the Project have been signed with renowned Brazilian and Chinese construction companies with track records of executing projects in the transmission sector.

The Project’s E&S risks are rated as substantial due to significant E&S impacts associated with nature and scope of Project components. Key E&S impacts include habitat fragmentation, impacts on avian species, significant soil erosion risk, physical resettlement and economic displacement, potential risks to community health and safety, construction-related impacts, impact on cultural heritage sites, and potential impacts on the livelihood of indigenous people. These E&S impacts and risks would be managed and mitigated through an Environmental and Social Management Plan (“ESMP”). Other site-specific E&S assessments and management plans will be prepared and implemented by the country’s E&S systems and as part of the Environmental and Social Impact Management Plan (ESIMP) to ensure compliance with the NDB’s ESF.